Bad Credit & Car Loans: How To Get Approved | Ottawa St-Laurent Jeep & RAM

Bad Credit & Car Loans: How To Get Approved

There’s a variety of reasons that lead to you being here today. After all, misfortunes happen and they can affect your credit score. Or maybe your credit’s simply non-existent right now. One thing’s for sure: you’re shopping for a vehicle and you’re having difficulty securing a loan – a loan for a car you need, like now.

So let’s forget the ‘why’ for a minute and focus on the ‘how’. How can you get approved for a car loan with bad or no credit? If you want to skip the details and get approved now, you can skip to this section right here. However, you might want to read or at least skim through this first.

Let’s get straight to it!

What credit score is considered “Bad Credit”?

Your credit score reflects your credit history and how you’ve been managing your money. It has a major impact on lender’s decisions when seeking for a loan and can be the reason you get approved or declined at crucial moments in your life. Credit scores in Canada range anywhere from 300 to 900. If you’ve checked yours before, you’ll recognize this:

Here’s the breakdown:

300-559:  Poor Credit
560-659:  Fair Credit
660-724:  Good Credit
725-759:  Very Good Credit
760-900:  Excellent Credit

Do you know your credit score? If not or if you haven’t checked recently, you can check right here

Why are you struggling to get a car loan?

There’s several factors that influence a yes or a no, but the two main factors in play are your credit  and your income.

1. Your Credit Score

If you stand in the red or orange (300-659), you’ll probably have a few more hoops to jump through to get a car loan. But don’t worry, there’s good news and there’s great news. 

The good news is that you can rebuild your credit and still get approved for a car loan in the meantime. The great news? A car loan is a great way to get that score up and fast (we’ll get to that in a bit)!

2. Your Income

Lenders will also look at other factors beside your credit, like your income. Usually, a steady income of at least $1,800 per month (or $845 bi-weekly) before taxes or deductions would still enable to qualify for a car loan – even with bad credit. 

While it’s true that meeting the minimum income isn’t a make-or-break situation when getting financed on a car, it can tilt the lender’s decision from a “no” to a “yes”. 

How To Get Approved For A Car Loan With Bad Credit?

Here are a few tips to help you get financed on a car: 


Your payment history (making your payments on time) has one of the biggest impacts on your credit score. So one of the best ways to give your score a boost and build trust with lenders is to regularly make your payments on time.

In order to be successful, you should get an idea of what you can afford every month and find a vehicle that fits that budget. Our payment calculator here can help you gauge how much you can spend on a vehicle and break down your monthly payments for a better idea. If you have a vehicle to trade-in, it can help lower your payments even more. You can get an appraisal on your trade-in right here.


Whether you’re shopping for a car, truck, minivan, or SUV, you should definitely take a look at used and pre-owned options. You’ll find a variety of options and great deals. Plus, you get nearly all the benefits of a new car at an even better price.

3. Decide on a down payment

Just like when buying a house, a down payment is a percentage of the price paid upfront. Putting a down payment on your next vehicle can increase your changes of approval. 

However, a down payment isn’t possible for everyone and therefore zero-down options are available on new and used cars. When possible, it might be worth waiting before getting a vehicle to save up a little and get a down payment. 

4. Consider a co-signer

A cosigner should be a trusted friend or family-member who is willing to share the responsibility for your loan. By doing so, they reduce the lender’s level of risk and by default, increase you chances of approval.  Again, a co-signer isn’t an option for everyone and you can still get approved without one.


Shopping for a vehicle with no credit or bad credit can be difficult and leave you confused at time. The best way to go about it is to get pre-approved online before you shop. Keep in mind, unsuccessfully applying for car loans too many times will affect your credit score negatively. In fact, the more you apply, the lower your changes of getting a ‘yes’. 

Instead, do your research and find a lender or dealership that specializes in financing people with Bad Credit or No Credit. A specialized lender will get you approved on a certain amount and you can then shop with confidence. After all, there’s no point in shopping for vehicles that you won’t qualify for. 

If you’re in the Ottawa region or just a short drive away, we at Ottawa St-Laurent Jeep & RAM specialize in rebuilding credit through car loans. Apply for financing online or call us at 613-604-9858 for advice and to discuss your options.

How will a car loan help you improve your Credit Score?

Getting your credit score up to the Very Good/Excellent tier may take some time, but getting a car loan (and being responsible with it) is a great start.

Payment history makes up for approximately 35% of your score. Making your car payments on time every month will build trust with lenders. Over time, it will increase your credit score and will help you get better rates in the future on not only car loans, but also personal loans and mortgages.  It could also help when applying for rental units.

We're here to help!

At Ottawa St-Laurent Jeep & RAM, we specialize in financing people with no credit or low credit. We understand that misfortunes happen and they can affect your credit score. Which is why we focus on your current situation and look beyond just your credit history.

Let’s rebuild your credit with a 100% Guaranteed Approval!

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